- Hills (HIL) has provided a market update on its expected 2020 financial year (FY20) results, revealing it will likely report a statutory loss of up to $7 million
- The losses are due to redundancy payments, inventory provisions and volatility of the Australian dollar
- But, the original Hills Hoist business said it will significantly lower net debt, from $28.4 million in FY19 to below $9 million in FY20
- Overall the company expects to emerge from COVID-19 with a stronger balance sheet, after reducing costs
- Shares in Hills closed steady, trading at 15.5 cents per share
Hills (HIL) has provided the market with an update on its expected 2020 financial year (FY20) results, revealing it will likely report a statutory loss of between $6 million and $7 million.
The losses for FY20 are due to redundancy payments, inventory provisions and volatility of the Australian dollar, which in total add up to between $7 million and $8 million.
But, the original Hills Hoist business, which now focuses on business technology, said the losses it expects for FY20 are still an improvement on last year’s statutory loss of $8.8 million.
The company also expects its net debt position to improve in its final FY20 results. Hills had $28.4 million in net debt at the end of FY19, but it expects to lower than amount down to below $9 million for the end of the 2020 financial year.
The company said the reduction in net debt reflects proceeds from the divestment of non-core businesses, which were part of a wider restructuring program it conducted throughout CY19.
Meantime, Hills also revealed its final losses for FY20 have been offset by JobKeeper payments and the company’s wider cost reduction program – which involved reducing staff wages.
Speaking on today’s expected results, Hills Chief Executive and Managing Director David Lenz said he was proud of the company’s resilience.
“The relative resilience in our key markets and the material improvement in our balance sheet, help position the group to navigate a continuing period of disruption and emerge in a strong competitive position,” he said.
Shares in Hills are trading steady at market close today, August 14, with shares worth 15.5 cents each.